Conico Ltd: Polymetallic exploration in Greenland

Conino-ltd-executive-director-Guy-Le-Page-in-boardroom-broadcasts

An ASX-listed mineral explorer with assets in three sites across Greenland and Australia, Conico Ltd has recently received exciting news, having seen positive indicative results suggesting the presence of minerals at its Ryberg site.

Listed on the ASX (ASX:CNJ) in 2006, Conico Ltd has recently begun polymetallic exploration at two sites in Greenland. Executive Director Guy Le Page joined the Conico board in March 2006, and is currently assisting with the management of the Greenland exploration activities, which is now in its second field season. Mr Le Page has ten years of experience as a geologist and has spent over twenty years as a resource analyst and Corporate Advisor with RM Capital Group, where he is actively involved in a range of corporate initiatives from mergers and acquisitions, and initial public offerings, to valuations, consulting and corporate advisory roles. Mr Le Page spoke with us recently to explain the background of Conico, the details of its portfolio of projects, and the positive indicative results recently found at the Ryberg project in Greenland.

Multiple projects

Conico has two projects in Greenland, Mestersvig and Ryberg. The project area at the Ryberg site, where the company will be spending the entire of its second field season, is located within the North Atlantic Igneous Province (NAIP), and has two prospects so far, Sortekap and Miki Fjord. 

Additionally, Conico is involved in a domestic project in Mount Thirsty, a cobalt/nickel project located 16km northwest of Norseman, Western Australia, which is a 50/50 joint venture with Barra Resources.

“The company was listed in 2006,” Mr Le Page explains. “It was a spin out from Tasman Resources Ltd, which I’m also on the board of. It had a portfolio of exploration projects in South Australia, and then moved into cobalt and nickel by acquiring the Mount Thirsty project.”

Mount Thirsty is Australia’s most advanced genuine cobalt project, and had a Pre-Feasibility Study (PFS) completed in 2020.​ The project is close to all necessary infrastructure and in a mining-orientated state. Since the completion of the PFS, cobalt prices have dropped, meaning the project will require a price rise to get it re-incubated.

“More recently, in late 2020, we finished the acquisition of Longland Resources, which had title to the Ryberg project in Greenland, and then subsequently we picked up Mestersvig to the north, so most of our activity has been directed towards Greenland [since then].”

The site at Mestersvig is a lead and zinc historical mine, which produced about 0.5m tonnes of 9% lead and 9% zinc back in the 1950s and early 60s. It is a large license area near the Danish military base, with good access and port facilities.

“We had intended to go and do some work [in Mestersvig] this year,” Mr Le Page says, “but ran out of time unfortunately. The main focus this year is at Ryberg, where we have got two prospects.”

A multi-element project spanning an area of 4,500 km2 area on the east coast of Greenland, Ryberg is an under-explored mineral province with a significant amount of magmatism that has intruded the sulphur-rich sediments of the Kangerlussuaq Basin.

Conico-Executive Director-Guy-Le-Page-in-Boardroom-Broadcasts
This is the first diamond drilling programme that’s ever been undertaken in this part of east Greenland

“We got attracted to the project based on some high-grade nickel, copper, gold, cobalt and palladium assays on the surface,” Mr Le Page says. “They were taken by Longland a few years ago, and some of the sampling we did last year confirmed those results.”

Magmatic sulphides have been seen throughout the licence area, but most activities to date have focused on the Miki and Sortekap Prospects. Drill ready targets for potential disseminated to massive sulphide accumulations have already been identified via a high-resolution electromagnetic survey.

“We’ve had visual indications of mineralisation that look encouraging. We haven’t got any assays back yet, but visually, we’re pretty encouraged by what we’ve seen. So a couple of big announcements and plenty of interest from the stock market, which is good.”

The company’s second field season has been in progress for about four weeks on the ground in East Greenland, with three rigs on site and a team working off a ship not far from the project area in Miki Fjord.

“[At] Miki Fjord we got some nickel, copper, platinum, palladium, gold and cobalt assays from the surface rock chipping that we’re following up, and I suspect that’s what we’ve been intercepting in the holes we’ve put down there so far. About 20km away at the Sortekap project, [we’ll have] predominantly gold, nickel and copper by the look of it.”

Conico’s exploration into its Greenland sites are still in the early stages, but the company’s longer term strategy is already taking shape. The priority for 2021 has been to follow up on the surface rock chips found in Ryberg and see if the results could be replicated through drilling. 

“Miki has been the focus of about eight holes so far, seven of which have hit sulphides, anything from massive sulphide to disseminated, so that’s been pretty encouraging. We’re continuing to drill along a 50km strike length at approximately 1km to 1.5km intervals.”

Another area of focus is the maiden drilling programme at Sortekap. The last hole was finished recently, producing some high-grade magnetite containing disseminated sulphides, predominantly chalcopyrite and pyrrhotite.

“Field season will wrap up in early October this year, so that will conclude a three month drilling programme. There will be a lot of work coming up in October through to May, not only planning an early entry back into Greenland in May, but also analysing all the assays and re-logging core from this years field season.”

The company will be assaying for a large suite of metals, and already knows there are large zones of mineralisation, so the excitement is building around seeing the assays to find out more specific information about what is present with good results likely to prompt an expanded programme for the 2022 field season.

CEO Thomas Abraham James is a geologist and founder of Longland Resources currently based in Greenland

Executive team

As the company gathers pace and builds towards more focused activity, the executive team is working primarily in a part-time capacity, the idea being that with some good results in Greenland the people working on a full-time basis will be added to.

“The main driver of the project is [CEO] Thomas Abraham James, who is a geologist and founder of Longland Resources. He’s been based on site in Greenland, managing this programme, so he’s been exceptionally busy managing people, rigs, food, logistics. It’s been a very busy three months, and looks set to continue for the next couple of months.”

The executive team is completed by Mr Le Page and Chairman Greg Solomon, who has practised as a commercial/corporate lawyer in WA for over 25 years. Non-executive members Doug Solomon and James Richardson make up the remainder of the Conico team.

“The next milestone will be to get all the assays back from this field season, because we haven’t been able to ship many samples out yet. We’re trying to ship one lot out at the moment, but we should have all the assays back in November/December this year..”

The potential is there for all to see, and Conico will now be looking to build on the positive indicative results it has seen in the Ryberg region, with potential investors having an eye on results due later in CY 2021.

“Logistics are challenging,” Mr Le Page concludes, “but I think the prize is pretty big. It’s the first diamond drilling programme that’s ever been undertaken in this part of east Greenland, so we’re all pretty excited to see what comes of it.”

With a very promising set of early findings at its Ryberg site, the future looks bright for Conico’s polymetallic exploration in Greenland. Find out more about Conico Ltd by visiting conico.com.au

Vanadium Resources (ASX:VR8): Easy to mine vanadium in South Africa

Vanadium Resources-CEO Eugene Nel-In Boardroom Broadcasts

An ASX-listed junior vanadium developer, Vanadium Resources owns 74% of the world class, tier 1, Steelpoortdrift Vanadium licensed mining project in Limpopo Province, South Africa.

Founded in 2017 and listed on the ASX (ASX:VR8) in 2018, Vanadium Resources has just completed an exceptional pre-feasibility study in the Steelpoortdrift project in South Africa. CEO Eugene Nel is a qualified metallurgical engineer, starting his career in mining production operations in the early 1990s. During a twelve year period he worked as a metallurgical and operations manager at a number of operating mines. For the last fifteen years Mr Nel has worked in a consulting role to the mining industry, assisting companies worldwide to bring their products into production, as well as assisting with production efficiency improvements. Mr Nel spoke to us about the benefits of the Steelpoortdrift project, the gap in the vanadium market the company is looking to fill, and the promise of an excellent return for investors on a premier vanadium deposit.

Steelpoortdrift project

“Vanadium Resources was listed on the ASX in early 2018,” Mr Nel says, “basically as a reverse listing by a company in South Africa. The mining project being brought on board at that stage was the Steelpoortdrift project, with Vanadium Resources acquiring a 74% stake in the associate South African company who holds the mining rights for the project.”

In addition to its presence for this project in Limpopo Province, South Africa, Vanadium Resources also has ownership in the Quartz Bore Project, a copper-lead-zinc project in Australia’s West Pilbara province, 80 kilometres east of Roebourne in Western Australia.

Work completed on the Quartz Bore Project has been primarily directed towards the discovery of new Volcanogenic Massive Sulphides and previous work has defined a prospective strike length of approximately four kilometres. This project is currently on ice as the company pours all its focus into its flagship Steelpoortdrift project.

“We’ve got a presence in Australia, with half the board being based in Australia, and our company secretary, and then the rest of the board – plus the mining executives – being situated in South Africa, where our main project is located.”

The company has recently seen some excellent results from its pre-feasibility study (PFS) on the project, which essentially checks for the four main pillars that any mining project needs to have in place in order for it to be successful.

“The first pillar being, you need to have a big enough resource that it makes it economical to mine and gives you enough life. In the sense of the Steelpoortdrift project, we’ve got in excess of 350 million tonnes in the measured and indicated categories, so we’ve got a life of mine well in excess of 25 years, probably even longer than 100 years. So the first pillar we cover.”

The second important pillar is for the material to be easily minable. At Steelpoortdrift there is a huge slab of mineralised material 10-30m wide, sitting just below the surface and tilting gradually towards one end, making it an easily mineable resource. This will help the company bring Opex and Capex down significantly.

“The third pillar is that the material needs to be amenable to metallurgical processing, and in the case of Steelpoortdrift all the metallurgical test work showed that it is easy to process. We can get very high upgrade ratios, some of the highest in the industry.”

The final pillar is to have the required grade in the resource, in this case to have vanadium present. The in situ grade at Steelpoortdrift is amongst the highest vanadium grades in the world, lying between 1.1% and 1.2% vanadium in the high grade sections. There is about 180m tonnes of this high grade material present in the area.

“If you’ve got those four key pillars in place, that’s why we’ve been able to produce an outstanding pre-feasibility study, where we’ve shown that at a capital cost of $200m we can achieve a total project NPV of $1.2bn at an IRR of 45%.”

The company will be producing a vanadium flake greater than 98% purity, on which the production costs will be in the region $3.08 per pound, putting it in the lowest quartile for the entire industry.

“With all those factors in place,” Mr Nel explains, “the PFS highlights that this is a world-class, low-cost, high-volume project, with a very high degree of confidence that it can succeed.”

Vanadium Resources in Boardroom Broadcasts
An ASX-listed junior vanadium developer, Vanadium Resources owns 74% of the world class, tier 1, Steelpoortdrift Vanadium licensed mining project in Limpopo Province, South Africa

Vanadium

The mining environment in South Africa is well established. The Steelpoortdrift titaniferous magnetite deposit is located in the prolific Bushveld Geological Complex, within a known mineral and vanadium producing area within reach of proven processing plants, railway and road options and ports.

There are 10-12 other major mining operations within a 30km radius of the Steelpoortdrift project, operated by international companies like Glencore, Anglo-American Platinum and African Rainbow Minerals.

“In the context of operating in South Africa with such a well-established mining environment, it does allow us to operate at a much lower cost than for example somebody putting up a mine 600km in the bush in the middle of Africa.”

The infrastructure is stable, meaning the company has access to water and power, as well as to labour skills from the region’s sizeable mining community. Logistically, it is situated about 200km drive from Johannesburg, where more than 90% of its processing plants, equipment and material is manufactured, helping to cut costs.

“On the other side of the spectrum, because South Africa is a mining country – we’ve been mining in this country for the last 150 years – the government does understand mining, and there are quite a few legislations that have recently come in that are mining-friendly, and trying to promote the mining environment.”

There is a well-established banking system in the country, meaning there are no problems with Forex controls and other issues that may impact upon the operating environment. In that sense, South Africa is one of the easiest places to do business in Africa for mining.

“Vanadium is actually one of the more abundant materials in the world,” Mr Nel says. “As far as I remember it’s about the sixth most abundant material or mineral in the world. However, it’s not always very commonly found in deposits where it can be mined.”

Vanadium has a variety of different uses. Up until now, the majority has been used in steel making, as a compound added to rebar to increase its tensile strength. It’s also used in the aeronautical industry and in a wide variety of other chemical industries.

“Historically, steel making has made up about 90% of the consumption. However, that picture is starting to change. For the last ten years the implementation of vanadium redox flow batteries, or VRFBs, has become more prominent. A VRFB is a bulk electrical storage battery that’s used very commonly with renewable energy projects.”

This is the type of battery that isn’t limited by cycle times or cycle life, so has an unlimited life. It can also be charged and discharged at the same time, so it’s got a very high application in the renewable energy and bulk energy storage sector.

“With the movement away from fossil fuels and for the world economy trying to be more environmentally friendly, the market for VRFBs is set to increase exponentially over the next 10-15 years. Bloomberg has predicted that the battery market alone will increase by up to 300 or 400% within the next 5-6 years.”

This growing secondary market to steel production is predicted to be in a supply deficit by 2025, as there haven’t been any new projects coming online in this sector for the last ten years, and there aren’t any major new projects due to come online in the next year or two.

That deficit could be significantly higher if the VRFB market grows more than expected. 

“Current projections show 5% growth YOY in vanadium demand,” Mr Nel says, “and with some ageing infrastructure on existing mines, we do believe there is a major market share that needs to be filled.”

Vanadium Resources in Boardroom Broadcasts
There are 10-12 other major mining operations within a 30km radius of the Steelpoortdrift project, operated by international companies like Glencore, Anglo-American Platinum and African Rainbow Minerals

Diverse senior management team

Mr Nel ended up becoming involved with the company through his previous consultation work, where he once was employed by Vanadium Resources. His work involved managing the company’s metallurgical test work and all the design work up to the scoping study level.

“There was then the natural progression when our previous Managing Director resigned, that I got promoted into the CEO role. In terms of the other key team members, Mr Jurie Wessels is our Chairman. He’s been involved in the mining industry for about 25 years, heavily involved in the exploration side of things.”

Mr Wessels has significant experience in the sourcing and assessment of exploration and exploitation projects and in the governance, funding and management of resource companies. He has explored for various minerals in Africa, South America, and Europe and practised as a minerals lawyer up to 2003.

“Mr Nico Van Der Hoven, another Director, is also currently Chairman on Bauba Resources, which is an operating chrome mine, not too far from the Steelpoortdrift project, so he’s got a very in-depth knowledge of the mining environment and mining operations.”

Non-Executive Director Michael Davy has over 16 years’ experience across a range of industries, having previously held a senior management role for Songa Offshore where he assisted with the start-up of the Australian operations and managed the finance team for a two rig operation with multi-hundred million dollar revenues.

“Mr John Ciganek is qualified as a mining engineer, but for the last twenty years he has been heavily involved with debt structuring, financing, mergers and acquisitions. If you look at that team, we’ve got quite a range of expertise, so a very diverse group of senior management.”

There are several issues currently affecting the vanadium market as a whole. COVID-19 has actually had a slightly positive impact, with a huge amount of infrastructure development projects coming out of it, which will need steel for construction.

“The other impact that has occurred is in China. With China’s move towards reducing carbon emissions, they’ve placed a cap on some of their furnaces. The furnaces in China produce vanadium as a secondary by-product, and with there being a cap on their production levels, their production of vanadium is starting to be curtailed.”

This meant that 2020 was the first year that China became a net importer of vanadium, rather than its historical position as an exporter. This added to all the other environmental legislation around carbon emissions means that the vanadium market will grow significantly going forward.

“Finally, I noticed a day or two ago that China has also placed a curb on the reuse of lithium batteries, due to safety concerns. With lithium being one of the major competitors to vanadium in the market, we believe that might also have a slight impact on the market share of vanadium going forward.”

In terms of future growth, Vanadium Resources has just finalised its pre-feasibility study, and now has short term goals of making use of this study to finalise its maiden ore reserve statement, which is very close.

“With a pre-feasibility study of that magnitude coming out, there is a lot of interest in the market, so we will be engaging any potential funders around going forward into our definitive feasibility study [DFS], and we’re hoping to commence that by [August 2021], with completion early next year.”

The company’s medium term goal then is to complete the DFS, then to make the final investment decision on the project, and then to start construction on the mine towards the latter part of 2022.

“Key milestones would be the clearing of the maiden ore reserve, it would be commencement of the definitive feasibility study, and potentially looking at off take agreements on the back of that, and then final investment decision to construct.”

Vanadium is one of the dark horses in the renewable metals space, but Mr Nel is sure that when people start to understand the market, they will realise that Vanadium Resources is currently sitting on one of the premier deposits in the world.

With a deposit of vanadium that is of the highest grade, the biggest volume, and is easy to mine, Vanadium Resources is about to have a lot of eyes on it from potential investors, and the company welcomes such attention. Find out more about Vanadium Resources by visiting https://vr8.global/.

How Covid is creating the perfect distraction for new Cold War adventurism

Flash points across the globe and disturbingly serious geopolitical decisions taking place at this time of the pandemic make for hard reading for any business executive, funds manager or investor. 

This is not likely to be a “Cuban Missile Crisis” moment – more of a Berlin Airlift marker in time. Historians and policy wonks alike might suggest that we are facing a mid pandemic crisis of our own making: authoritarian states acting without due caution and free societies subsumed by the herculean tasks of medical, social and economic recovery. 

Three separate but somewhat related news items in April 2021 could easily be ignored or seen as minor footnotes in an already complex defence and security landscape. Taiwan, Ukraine and the UK’s nuclear arsenal seem very different to the expert eye – somewhat awkward for any commentator to bind together into a compelling narrative. But they are just as strategically important as vaccination programs, Covid testing regimes or labour market conditions as societies come to grip with a global shock that was more immediate than the 2008 financial crisis, terrorism or climate change.

The three flash points or markers are a sign that we are neither in “peace” or “war” but in a period of military/security adventurism. The sort of thing that markets, investors and corporate leaders despise for its uncontrollable nature. Mistakes can be made and errors in decision-making can be critically significant.

We have the People’s Republic of China (PRC), with its new found investment in high tech weaponry, blue water navy aircraft carrier capacity and extensive amphibious deployment skills, operating a high risk incursion strategy over Taiwan’s controlled airspace. 

Of course, Beijing views the rebel province as a breakaway relic of the Civil War and Cold War eras. But a democractic, liberal and prosperous Taiwan is a thorn in the side of the narrative that China requires both political and economic authoritarianism to create the conditions for affluence (for the privileged cadres), improvement (the many) and alleviation from abject poverty (the remainder 100 million). 

More than a hundred military aircraft incursions over recent months have tested the resolve and the readiness of the Taiwan State. Intimidation and aggressive diplomacy making US commitment to Taiwan’s security a real flash point in super power relations.

Ukraine’s eastern borders have seen massive troop build ups by Russian military operations – so called exercises and regular deployments – in a way reminiscent of the earlier capture of the Crimea and Don Basin. 

NATO worries are compounded by the decision years ago to falter in steps of offering Ukraine NATO membership – in support of early post Cold War guarantees/promises by confident politicians and strategists – long overdue in the eyes of Baltic members like Lithuania. Frontline NATO states like Norway, Sweden, Poland and Turkey have eyed Russian activity with concern over the last three years. Instability in Europe – considered the epicentre of the Covid crisis by some – is feeding a belief that Western security is fragile in the face of robust Russian efforts in the Far North (Artic), Black Sea, Syria and Africa to extend its reach of influence.

Finally, the focus of the United Kingdom’s Integrated Review into its near term defence and security needs is telling. More money for Cyber, Grey Zone warfare capabilities, Information Warfare and Special Forces. More than nine thousand fewer soldiers and the end of the commitment to deliver a Division to any land warfare environment. The British Army to be more likely to be seen as a “two brigade” asset in this era. Smaller than any time since the early period of Victoria’s reign. But importantly a rise in the permissible number of nuclear warheads – a 15 percent increase that shocked experts and policy writers alike.

This increase in the “hitting power” of the UK and its accompanied media confirmation that the rules/framework behind allowed use of such missiles have changed are critical pointers to a heightened geo-political period of tension, preparedness to respond and ability to cause catastrophic damage. Rogue regimes like North Korea or Iran can be easily seen to be given due warning that diplomatic admonishment or economic sanctions are not the only option available.

What do these three ugly reminders of reality tell us? It is a more dangerous and risky environment than 2019, 2008 or 2001. There is an appetite by major authoritarian players (Russia and China) to flex their muscles in a way that will undermine and confront the rules based international order. This is no surprise but a meaningful reminder that economic/social nationalism stoked by the pandemic, closed borders and disrupted trade can produce the conditions for aggression unchecked by cautious statecraft. There is a growing appreciation by Western countries that freedoms cost money, investment and updated deployment of relevant technology. A 40% increase in defence spending by Sweden (compared to early 1950s Cold War levels), open investment into ballistic missile technology by Australia, increased nuclear arsenal by the UK and dedicated naval exercises by the Quad (US, India, Japan and Australia) near the South China Sea all deserve attention from business, investors and shareholders. 

We are not about to walk into a global conflict. But what we seem to be doing is striding forward towards a pathway that will comprise increased sovereign risk, higher likelihood for technology/trade sanctions and greater taxation calls on corporate profits. Big tech, mutual funds and profitable transnational corporations should not be surprised if Western governments impose more controls and burdens to defend the very societies that create the conditions for wealth and innovation.

It is more like 1948 than 1962. It is the beginning of a fresh conflict between strongly divergent social/political values. What worked in the past – collaboration between Wall Street, Main Street and Government – may not be easily replicated. But expect to be asked what you can do for your country. It might be more significant than any nominal flag waving, BLM or CSR strategy. It is about recognising that the period of globalisation as we knew it (supply chain across five continents with free flows of capital and even people) may well be a thing of the past.

Noel Hadjimichael is a London based public policy consultant in the security, defence and civil society space with relevant experience working in politics, the civil service, industry and the charitable sectors. 

Prepare for a post-pandemic spending boom & bust

David Rosenberg is the Founder, Chief Economist & Strategist of Rosenberg Research & Associates in the Boardroom Broadcasts

If you ask anyone in the market why they are bullish for 2021, they will tell you right away that they see a light at the end of the Covid tunnel. And indeed, with the multiple vaccine news we have received since the beginning of November, there is a light. There may be many potholes, with the coronavirus cases, hospitalisations and fatalities on a disturbing upward trajectory, and a very tough winter staring us in the face, but there is a light that we can now all see. To have vaccines developed and now distributed in such volumes and with such tremendous efficacy levels, and done so quickly, does indeed make one tempted to believe in miracles we thought were only saved for the bible stories.

So what lies ahead for the coming year. A very rough first quarter for the economy. And then a better second quarter. And quite likely boom-like conditions in the second half of the year as substantial amounts of pent-up demand get released. You speak to most people, and the first thing they want to hear upon getting the jab are the words “please fasten your seatbelts”. Travelling, mall browsing, bar hopping, eating out, dare I say, socialising, will be all the rage. It is called “pent-up demand” for a reason. And this will be the single dominating force driving the economy in 2021, barring any unforeseen setbacks (as in, not enough of a vaccine take-up to achieve the Holy Grail of herd immunity. No central bank will dare tighten monetary policy even if inflation rears its (pretty?) head, the fiscal spigots will remain turned on in a major way. Interest rates, by hook or by crook, will not be allowed to rise as they have typically done in past aggressive economic recoveries. If you are a policymaker today, the last thing you will be doing is upsetting any apple carts.

So the economic outlook for 2021 is perhaps the easiest one to make that I can recall in my 35 years in the forecasting business. There will be a post-pandemic spending boom. It’s only a matter of how big and what quarter it begins. That light, indeed, does shine bright. Much of this good news, as an aside, is priced into every global financial asset you can probably name. Even the previously beaten-up airline, casino, retail and hotel stock you can think of has priced in the light at the end of the tunnel.

But, you see, from a financial markets standpoint, just as the economy booms next spring and summer, even into the fall, investors will at some point in 2021 have to confront what life is going to be like once we get past the light. At some point next year, I guarantee everyone that just as the markets were soaring during the darkest of hours during the pandemic in 2020 because of the light they saw at the end of the tunnel, these same markets will be beyond that light even as we all go out and have fun again. That’s the thing about markets – they move earlier and more quickly than people do.

All that said, I do think from an economic standpoint, there will be an economic recovery of epic proportions. But the recovery beyond the end of 2021 will be muted and frustratingly slow, and it could take at least three years before all the economic damage from the virus and the lockdowns are ultimately recouped. Then think of a future with massive public deficits, debts, and government intervention and regulation. Then we have to consider, when we get to the other side, how these massive central bank balance sheets will get dealt with. Will the debts get monetised or not? And a world of reduced globalisation and more localised supply chains, an end to-just-in-time inventories, and what the future holds for taxation. I don’t know about you folks, but it is crystal clear to me that in this period of heightened uncertainty, it will be capital, and not labor, that defrays the cost of the rescue packages, and that means higher tax rates on capital gains and corporate income. The current surge in the deficit is not about shovels in the ground with some hope of future multiplier effects on the economy – it is simply a transfer from some future taxpayer to today’s household and business who are out of work and for some reason had no cash, savings, or liquidity to get through even a few months of shutdown for public health purposes.

What the world looks like when the crisis ends is truly anyone’s guess but I will say with 100% clarity that it is going to look a lot different than it did before. Not just the question over government policy, but at the individual level, months of isolation and distancing, and fear of a return of the pandemic are going to fundamentally alter lifestyles, and will have a profound influence not just on the way we live but how we conduct ourselves in our personal and commercial lives. For example, working from home is certainly going to be a more dominant force even once we move beyond the light at the end of the tunnel, with obvious negative implications for commercial real estate but positive implications for internet infrastructure, computer hardware and video conferencing. There is going to be a sharp reduction in travel to work, travel in general, and this means fewer cars on the road, there is nothing here that is very good for the auto sector, and the future therefore is really clouded for office REITS and commercial real estate in the large densely populated urban areas. But there are some bullish themes that emerge too. As we go into an era of elevated personal savings rates where people are going to focus on what they need, not what they want. This means to screen all of your equity exposure for “utility-like” characteristics – and that includes anything related to ecommerce, cloud services, delivery services and wiring up your home to become your new office. What lies beyond the light at the tunnel is a secular shift in economic behavior that took place during this grim period of history; shifts I believe are secular in nature, that tell me to focus on areas of the market, consumer staples, health care and even big tech, that have morphed into essentials.

No doubt, the investment community is paying more for duration today than they ever have in history but since we can anticipate rates to stay low for years to come, this valuation driver becomes the dominant issue that will be driving the market and prospective returns. This is exactly why growth investing trounced value for much of the past decade, even before the pandemic. Ultimately, the growth-versus-value decision depends on what the world will look like once Covid-19 is in the rear-view mirror. But even with a vaccine, if we return to the pre-Covid world, when you think about it, it actually means a return to a slow-growth, low-interest-rate, and low-inflation world, which means growth will remain the place to be because they are the longest duration stocks in the equity market. For cyclicals and value stocks to work, you want faster economic growth, signs of inflation, and higher interest rates. There’s been a move recently into the value trade and it does make sense since these stocks are dirt cheap and deserve to be rerated positively for a post-pandemic world. But at the root, this is really just a mean reversion trade, and it may have more legs to it. But that is why it is referred to as the ‘value trade’ and not the ‘value trend’; for the same reasons value unperformed growth 80% of the time and by more than 3 percentage points per year during the 2009-2019 bull market expansion.

The major point I need to emphasise right out of the gates is that it can’t possibly be lost on anyone that what we had was a health crisis that morphed into an economic crisis and then somehow managed to morph into a financial crisis that was ten times worse than anything we saw in the Great Financial Crisis. We simply refuse to stop these cycles of redressing debt crises by adding more debt, which merely compounds the adverse effects from the recession that is inevitable, and yet at the peak of the cycle nobody ever seems to be prepared for one.

The vaccination process is no reason to believe we are not in some form of economic depression that has only been disguised by unprecedented policy stimulus. Just because your kid has training wheels doesn’t mean he (she) knows how to ride the bike. And we have an economy on our hands that could not survive without large-scale deficit finance and central banks suddenly acting like hedge fund managers. This is why it’s going to be a depression because what comes next is a secular change in attitudes towards credit and towards savings. I mean, seriously, over half of American households didn’t have enough cash on hand to even get through three months of a job loss — quite remarkable when you consider Canada went into this mess with a 50-year low unemployment rate of 3.5%. Not to mention the corporate sector where, for some reason, the word “liquidity” became a dirty nine-letter word this past cycle. Now every business has working capital they have to cover with a fraction of last year’s cash flow. And this got me thinking about how the future will be one of treating “savings” as sacrosanct. Beyond the quarter or two of pent-up demand release in 2021, frugality is going to emerge as the primary theme. It’s not the end of the world, either, unless you’re an advocate for a sustainable and vigorous economic expansion.

In a narrow view, the markets are telling us that the ‘new normal’ will be a ‘reversion to the mean’ where life goes back to normal. And to that I say not so fast. People will surely go back to restaurants, hotels and airplane travel in due course, but don’t think for a second that there will not be residual impacts. The narrative emerging from the recent trading action in the equity market tells us that we are going back to our old lifestyles and that is what I would bet heavily against. I have seen, and continue to see, secular shifts in behavior that will transcend a couple of quarters of pent-up demand release, that we will be stuck with a permanently higher equilibrium personal savings rate and a permanently lower labor force participation rate. And if we do somehow revert to the old normal, remember that the prior ten-year period was one of low growth, low inflation and low interest rates. I don’t see that changing because the secular forces of aging demographics, massive debt burdens and extreme income and wealth inequalities, if anything, have become accentuated by the pandemic.
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What the world looks like when the crisis ends is truly anyone’s guess, but I will say with 100% clarity that it is going to look a lot different than it did before. I sense that some of the structural changes in our economy could be long-lasting. Global supply chains could shrink, and in some cases we might see the full repatriation of manufacturing in certain industries, for instance in pharmaceuticals, food and high-tech like semiconductors. Areas deemed to be in the realm of national security. Before the pandemic, the emphasis was on “just-in-time” production, with parts being delivered just when they were needed in the manufacturing process.In the post-pandemic period, the emphasis could shift, to some extent, to “just-in-case” supply chains, emphasising proximity and certainty of delivery. And then beyond the question over government policy, we have to consider at the individual level, how months of isolation and distancing and in the future, a fear of mutation of the pandemic, are going to fundamentally alter lifestyles, and will have a profound influence, not just on the way we live, but on how we conduct ourselves in our personal and business lives.

Then we have to consider, when we get to the other side, the massive government debts we will have built up and how that, along with even more bloated central bank balance sheets, will get dealt with. Will the debts get monetised, or not? Or God forbid, will taxes have to go up on the middle-class? Just some things to contemplate in 2021 as we get our booster shots and then race to the local brasserie. The stock market is not the economy so don’t believe for a second that record equity prices means the road ahead isn’t going to be a bumpy one.

David Rosenberg is the Founder, Chief Economist & Strategist of Rosenberg Research & Associates, www.rosenbergresearch.com.

Openspace Architecture: A window to nature

Openspace Architecture Owner Don Gurney in Boardroom Broadcasts

Based on Vancouver’s North Shore, Openspace Architecture is a boutique architectural and interior design practice specializing in single family and resort residential projects, with a broad range of experience in master planning and infrastructure projects.

A visionary who truly cares for others and deeply respects the land, Openspace Owner Don Gurney produces work that is contemporary in expression, with a deep understanding of the long tradition of architecture and design. Mr Gurney’s hands-on methodology is driven by his great reverence for the relationships between people, nature, and the built environment. The Openspace team strives to elevate the field of Architecture, creating a legacy through design excellence. Mr Gurney speaks to us about his experience of open space planning, the company’s focus on introducing its building system to countries around the world, and the commitment to creating buildings that provide a window to nature.

Open space planning

The practice began life in 1998 as Don Gurney Architects, founded by Mr Gurney alongside current Associate and Senior Technologist Eric Pettit. In 2008 the name of the company was changed to Openspace Architecture.

“That name comes from my planning experience,” Mr Gurney says. “I was with an international planning firm for many years, where we worked on projects internationally, but primarily in the downtown waterfront area [of Vancouver].”

Open space planning became a large component of those mega developments, during which Mr Gurney gained experience working for clients such as Marathon, Concord Pacific and Vancouver Port Authority. Realizing and working with open space planning became very important to him, and that’s how the name originated.

In his current work, Mr Gurney aims to find balance in the relationship between objects and spaces to create an effortless sense of harmony. He approaches projects with both restraint and an eye for detail, using natural materials to harness minimalist expression.

Openspace Architecture in Boardroom Broadcast
Based on Vancouver’s North Shore, Openspace Architecture is a boutique architectural and interior design practice specializing in single family and resort residential projects, with a broad range of experience in master planning and infrastructure projects

“My whole background has been in the construction industry. I started out very early, from my early teens, working construction. That led to a technical diploma in architectural design and drawing. From that I was a technician for five years with an architectural firm, then in 1983 I decided to go back to university and study architecture at Carleton University.”

Mr Gurney brings a humanist approach to his comprehensive understanding of planning requirements, honoring site context and working hard to enhance the way buildings are experienced, with the ultimate aim of creating harmony between indoors and outdoors.

Local and international projects

The projects Openspace has been involved in over the years have spread across Vancouver, from West Van to North Van and the Olympic training facility. Locally, the practice’s most notable work is in West Vancouver and the Whistler area.

Openspace Architecture in Boardroom Broadcasts
With a commitment to creating buildings that provide a window to nature, and the capabilities to introduce its successful building system around the globe, Openspace Architecture has navigated the coronavirus pandemic successfully

Known across the globe as a world class ski resort, Whistler has seen a lot of work over the last ten years, and it has become established as an all-seasons resort, bringing many more people to the area over the course of a year.

“It’s now for mountain bikers, and everything else from fly fishing to hiking, and everything else that goes along with that resort. As far as our clients are concerned [at Whistler], I would say that probably 95% of them are international clients, from all over the place – the UK, Australia, South Africa and Malaysia.”

In terms of its work in British Columbia, the practice’s footprint is far reaching, having done work on the interior of BC, as well as on Vancouver Island, in Tofino, Saanich Peninsula and Cowichan Lake. 

“Most of the projects we do,” Mr Gurney explains, “with the exception of West Vancouver, are secondary projects or second residential resort type homes. So this has been our primary focus for the last fifteen years.”

Openspace Architecture in Boardroom Broadcasts
Open space planning became a large component of those mega developments, during which Mr Gurney gained experience working for clients such as Marathon, Concord Pacific and Vancouver Port Authority

The company’s history has seen much of its work done in this space, making impressive second homes for high net worth individuals. Recently it has been moving into other architectural areas, such as hotels and restoration.

“We’re doing some restorative work that has been happening in California, most particularly in Sonoma County, where the fires have had a devastating effect on the wineries. We’re rebuilding a winery and a number of support buildings that were devastated by the Kincade fire in 2019.”

In addition to its work in California, the company has been involved in several other projects in the United States, including four successful resort homes at Noi’Ulu Estates, Hualalai, on the Big Island of Hawaii, and ongoing work at another resort in Hawaii building family homes for private clients.

The practice is also beginning a large and an exciting off-the-grid planning and architectural design project for residential homes, which will be located midway between Carmel and Monterey on the California coast.

In addition to local success, the passion for architecture in the company has led to projects in a number of countries, with a focus on taking local experience and adapting to the work and design styles of different cultures. 

“We started out doing simple timber frame homes, and evolved that over the years into doing these lovely projects which are a mix of timber frame and hybrid steel buildings. We’ve developed a nice system, and we want to introduce other countries – such as India, Japan, Mongolia – to these systems, to bring them a new type of housing.”

The company’s history has seen much of its work done in this space, making impressive second homes for high net worth individuals

Creative outlook

Architecture has always been a competitive sector, but in recent years it has seen the rise of new technologies, particularly in terms of highly integrated 3D modelling known as building information modelling (BIM), which have changed the face of the industry.

“[BIM] is taking over much of the industry, but where it hasn’t really reached is the residential market. These homes are every bit as expensive as some of the smaller hospitals and schools, but for some reason the digital information modelling has not got into the market. Given the level of sophistication of these homes, it certainly should be.”

This is an area that Mr Gurney feels Openspace Architecture has an advantage over competitors. With BIM, the company is able to resolve the buildings, relative to the site, in 3D computer modelling with integrated structural, mechanical, electrical and smart home systems, before even beginning construction.

With its focus on a highly creative process, Openspace offers a playful yet rigorous approach to design, bringing projects to life through the pollination of key ideas and a strongly integrated design process.

Openspace Architecture in Boardroom Broadcasts
Openspace offers a playful yet rigorous approach to design, bringing projects to life through the pollination of key ideas and a strongly integrated design process

The open space nature of its designs is integral to the company’s ethos. Buildings with lots of glass, and the large spans created by timber and steel, offer its inhabitants a huge window on nature, like a lens through which to view the natural world.

“It’s quite an experience to live in these homes. When you look at a particular site, whether it’s a mountain site, or a desert site, or a lakefront site, you find the best part of the site, and then put the building on the worst part of the site, so that you can view onto the best part. This is essentially what we mean by open space planning.”

Teamwork is integral to the company’s ongoing success. Clients and consultants are made to feel welcome and appreciated in Openspace’s creative studio, which provides the space for an invaluable exchange of cutting edge ideas and constructive critiques.

The company’s current focus is on taking the technologies it has developed to other countries, sharing with the rest of the world Canada’s excellence in the space. So far the reception in these countries has been very positive.

“Something that we think is important in the work that we do, whether it’s commercial work or residential work, is just keeping people in contact with real materials. We’re using materials like stone, timber, some metals, that once you walk in the building you don’t need a period of adjustment, your body is settled and at one with it.”

Coupled with the need for low energy consumption and sustainable design, the mixture of real materials and a feeling of communion with nature is the nexus of Openspace’s business, creating a blend of mind and spirit that remains critical to its success.

With a commitment to creating buildings that provide a window to nature, and the capabilities to introduce its successful building system around the globe, Openspace Architecture has navigated the coronavirus pandemic successfully. Find out more about Openspace Architecture by visiting www.openspacearchitecture.com

Envirosuite (ASX:EVS): A market leader in environmental intelligence

Envirosuite (ASX:EVS) CEO Jason Cooper in Boardroom Broadcasts

An innovative tech company with roots in science, engineering, and consulting, Envirosuite is a global leader in environmental intelligence, utilising proprietary technology and real-time localised data to help industries grow and communities thrive.

Envirosuite is an ASX-listed company (ASX:EVS) with its origins starting as far back as 1990. The company uses science and technology to deliver software as a service (SaaS) solutions relating to air quality, water quality, noise, and vibration, with a varied list of clients including airports, water, mining and industrial, waste and wastewater. Jason Cooper has 20 years’ experience in the technology sector, and recently took on the role of CEO, replacing Peter White. Mr Cooper speaks to us about the value of environmental intelligence, the market-leading outlook he brings to his role, and the huge avenues of growth that offer a significant return on investments now and into the future.

Helping businesses thrive

“Environmental intelligence first started to make the scene a couple of years ago,” Mr Cooper explains. “It’s how you derive insights from environmental parameters that exist. There has been a considerable emphasis put on how businesses and society interact with the environment.”

This has moved beyond a stage of simple data collection and into the realm of analysis and insights, with many companies now turning that information into goals that can be acted upon for the good of the environment, the communities that surround them and their own operations.

“We look at environmental parameters such as noise, vibration, water quality, dust and air quality, and we take those parameters and then we start to understand how that impacts the society or the asset in which the company is operating.”

For example, a mine site needs to operate within vicinity of a community, and by doing that it understands that there are certain environmental parameters that affect how that community lives and how the site can be safely operated.

“As you can imagine, excess dust coming out of a mine site would have a negative impact on communities. Certain conditions in that environmental intelligence will contribute to how that mine site operates. It’s about giving our customers actionable insights based on those parameters.”

Envirosuite’s SaaS solutions assesses factors such as weather, the existing location, and trajectories, in order to provide the mine operator with predictive insights to ascertain when the company should time certain operations and at which part of the mine.

“We have a fairly large spectrum of customers that we are focusing on. Whilst mining is certainly a strong focus for us – we have some of the largest organisations in the world as our customers – we also have a very strong footing within the waste and wastewater communities. These are companies like Veolia and Suez, who are both our customers.”

Within the wastewater industry, Envirosuite generally helps solve odour problems. Odours at treatment plants originate from the receival of waste and as a by-product of the treatment process. Local weather conditions can intensify the impacts of odours and how far they travel, which impacts the community. The company helps those customers detect the specific type of odour and how it is affecting the community.

“We’re also number one globally within commercial airports, doing noise monitoring. When a plane comes into land, certain planes you don’t really hear, but others may come in too fast, too much of a pitch, so there’s excessive noise created. Our customers are from Los Angeles to Beijing to Heathrow, and certainly very strong in Australia.”

The global shift in corporate mindset around environmental issues means companies around the world are now recognising the importance not only of being seen to be doing good, but also actually doing it. Envirosuite’s vision is to allow businesses to thrive in parallel with growing communities.

“For most companies around the world now, it’s about how they can build a growing and profitable business without having a negative impact on the environment that they live in. There are simple, basic fundamentals for our customers. They know and they recognise that there is a long-term engagement.”

Envirosuite in Boardroom Broadcasts
Envirosuite (ASX:EVS) offers three products including 1). noise monitoring in commercial airports, 2). dust, water quality, and odour monitoring, and 3). water and wastewater treatment infrastructure

The mine sites Envirosuite works with are situated in mineral-rich locations, where communities are also built. Similarly, some of the company’s customers are ports, which know that the city’s viability depends on ships coming in, to unload containers, and to leave. It’s a part of the city’s economic growth.

The result has been a shift in how these issues are approached. Businesses now come to Envirosuite proactively, with prior knowledge of a problem, and the desire to be able to keep growing and engage with the community. Envirosuite’s solutions help industries to optimise operations, while strengthening their social licence to operate by building trust with communities and satisfying regulators.

“A big part of our solution here is how our technology enables a business to recognise how it’s performing, how they then communicate that to the community, and how the community then feels engaged in jointly solving this problem.”

There have already been several new executive orders signed by US President Joe Biden around these issues, one of which is designed to secure environmental justice and spur economic growth. This is to encourage businesses working in a particular area not to have a negative impact on lower economic societies.

“If you look at the water situation globally, we know that it is a very scarce resource. By 2025, two-thirds of the world’s population will reside in water-stressed areas. There are certain reports that estimate by 2030, around $1.9 trillion needs to be spent to address global water infrastructure. What we’re doing is playing a pivotal role in enabling this transition.”

Market-leading outlook

Having recently taken over as CEO of Envirosuite, Mr Cooper is looking to make positive change. He reminds us that he is first and foremost an engineer, having spent many years working for Siemens. He calls Siemens one of the world’s greatest engineering firms, and says this experience taught him to take pride in market leadership.

“Siemens had a perspective that they wanted to be number one or two in any of the markets they operated in,” he says. “I really am taking that same approach here, which has helped us narrow our focus into the markets that we want to pursue. We want to be one or two in any of the markets we play in.”

Mr Cooper has recently returned from three years immersing himself in the machinations of California’s Silicon Valley, where he worked in high growth companies and gained an understanding of what corporate greatness really looks like.

“We operate now in very much a globalised world, and competition comes from every corner of the planet. You have to have the right strategy; you have to have the right product-market fit; you have to have the right team around you to achieve that. I think it’s having that big global picture about what does breed success – invest into those parts.”

A big part of his focus recently has been on product strategy. The company already has a strong product-market fit, but the aim is to invest further into building world-class software platforms based on scientific fundamentals, which the company has been built on.

An innovative tech company with roots in science, engineering, and consulting, Envirosuite (ASX:EVS) is a global leader in environmental intelligence

“A key part of our challenge is to take incredibly complex scientific models and to distil that into easy-to-understand information. [The key is] to simplify that message into something you can translate, and take meaningful action.”

Customer engagement is a fundamentally important area in building out the company, and Mr Cooper is putting a renewed focus on that. The company already has a strong global reach, but the aim is to build a truly world-class customer acquisition team, as well as closer relationships with customers.

The company currently offers three products; first is noise monitoring in commercial airports; second, the industrial platform focusing on dust and water quality monitoring, as well as odour monitoring; and its new product, EVS Water, helps design, optimise and improve biological, industrial, water and wastewater treatment infrastructure. 

“With our airport product, we’re already number one in that market. What we will see there is continued growth. We are starting to see an increase in air traffic, and that will continue. The world post-COVID will be very different for airports, but a large amount of that will be around that community engagement piece. We do see a strong airport growth.”

There is also some strong new product innovation coming through in the airport market, with continued investment into technology driving deeper into operations within the world’s leading commercial airports.

“Within the industrial platform, we are going to be focusing on mining, and waste and wastewater. We have a strong global footprint here; we have some of the world’s biggest customers. Our focus now is to broaden our penetration for some of these global accounts, to drive greater market adoption. What we’re looking to do now is to build a market, not just chase revenue.”

The final product, EVS water, is very new, having only been brought to market in the last three months. This targets water treatment facilities and other utilities. It combines artificial intelligence and digital twin technology to predict and avoid water quality incidents, while identifying process improvements and cost savings for facilities in real-time.

“This is around providing a return on investment,” Mr Cooper says. “We’ve seen within a short space of time absolute market validation. I see this as a huge growth potential for Envirosuite. We’ve got product-market for it, and we know where we’re going to be accelerating. It’s now just working out what is the best go-to-market strategy to actually get the shareholder return. In the short term, I see growth above 20%, and then beyond that there will be significant upside in the coming years.”

Mr Cooper is a big believer in purpose-driven companies, and in this respect Envirosuite is a great company to get behind. What is most noteworthy is that this is Australian technology being taken across the world.

“To be number one globally, based out of Melbourne, Sydney and Brisbane, is a fantastic example of true R&D, true ideation, and executing on it. We will be growing significantly over the next couple of years. We want to be on people’s radar, so for those people who believe in helping the environment and investing in technology, we’d love for people to come and talk to us about joining us on this journey.”

With a focus on helping businesses do the right things for the right reasons, and continued impressive growth, Envirosuite (ASX:EVS) is certainly one to watch out for in 2021 and beyond. Find out more about Envirosuite by visiting envirosuite.com

Bill Identity (ASX:BID): A leading global provider of utility bill management technology

Bill Identity Managing Director Guy Maine in Boardroom Broadcasts

Trusted by businesses around the world, Bill Identity’s cloud-based technology leverages Robotic Process Automation, removing the need for human intervention and giving organisations control over their energy spend.

Founded in 2012 and listed on the ASX (ASX:BID), Bill Identity operates across Australia, New Zealand, the United States, the United Kingdom and Europe. The company’s innovative technology serves its clients by improving data visibility, integrity and control. Managing Director Guy Maine has 20 years’ experience in senior executive roles across major Australian companies, and talks to us about the benefits of using Robotic Process Automation, the acquisitions that have helped the company grow, and plans to continue its growth by playing a role in the global automation of utility bills.

The fourth revolution

“The way I explain who we are and what we do is to bring this back to [the consumer],” Mr Maine says. “You would receive an electricity bill for your household, and when that bill arrives you would probably look at the cost, but you then probably don’t do much about that bill until you actually put it in your diary to pay it.”

Bill Identity (ASX:BID) deals with an expanded version of this process, relating to large multi-site enterprises that would expect to receive thousands or tens of thousands of bills that need to be paid every month.

“They wouldn’t have dissimilar practices to [the consumer]. They would receive those bills; they would enter those into their Accounts Payable system. They may check a few of them, make sure that the rate’s right potentially, and then approve them for payment.”

Bill Identity’s job is to manage electricity, gas, water and other commodities for these businesses. It runs the bills through a robotic workforce, digitising the data and exploring every item to make sure it’s correct, following up on any exceptions on the clients’ behalf and even paying bills for some clients.

“RPA, or Robotic Process Automation, is being talked about as the Fourth [Industrial] Revolution. RPA simply takes processes that have previously been done manually, and utilises a robotic workforce to do that same process. We’re talking about code and algorithms being built for us in the Amazon Cloud.”

For example, a certain robotic worker for Bill Identity would be programmed specifically to read every item on a particular bill, told where to find them in order for it to be digitised and put onto the company’s platform for other robotic workers to validate.

“It’s doing something through automation that previously you probably would have got on an Excel spread sheet, or you would have had someone manually entering that data into it’s own Accounts Payable system. So that’s what Robotic Process Automation is.”

Bill Identity in Boardroom Broadcasts
Bill Identity (ASX:BID) assists in the area of invoice management for companies expecting to receive thousands or tens of thousands of bills needing to be paid monthly

The company is unique in the world for utilising RPA in the niche of utility bills; no competitor in the sector is using robotic workers as a complete end-to-end process to collect, digitise, analyse, validate and pay a bill as Bill Identity does.

“We launched this business in Australia over 5 years ago, and we’ve been prosecuting our strategy here in Australia since then. We have since progressed, and our geographies are under management, so we’ve now been operating in the UK for around 18 months, and more recently in the USA.”

The company sees that it has a role to play in the global automation of the utility bills niche, using its propriety tech to help businesses across the world manage their bill stream more effectively and with deeper and richer data than they have before.

Though keen to grow organically, Bill Identity also recognises the strength of growing through acquisition. This was evidenced in 2020, when it acquired a UK-based management software business call Optima Energy Management.

“What we saw in Optima was a proprietary software platform, the owner had been managing that business for 30 years, built a good reputation up. His software purely managed validation of bills, and it was very good at doing its job, but it didn’t do the remainder of what we do: the collection of bills utilising robotic workers.”

The company recognised Optima’s existing software as something it could replace and upgrade, as well as benefitting from Optima’s expertise and market credibility, which bought with it a number of long-serving, important clients.

“For us, it was an acquisition that gave us scale and market share in a market that we certainly want to grow into and had already started that process. It was an opportunistic acquisition; it had a great database of clients; it was well-considered software; and simply we want to take those clients to the next level in terms of RPA and our platform.”

Founded in 2012 and listed on the ASX (ASX:BID), Bill Identity operates across Australia, New Zealand, the United States, the United Kingdom and Europe

When it comes to a tree of development that will further the technologies that Bill Identity deals with, RPA is the beginning of a journey that will move through machine learning on a pathway towards the ultimate goal of Artificial Intelligence.

“You have desktop RPA – which is utilising robotic workers to do simple tasks. Our RPA is more cognitive. We can have robotic workers that determine whether a bill is accurate or not without our intervention. With machine learning you go to the next step. There is an allowance in the code of robotic workers that they can start to see patterns in data.”

As the company signs more and more clients, machine learning would allow it to gain an understanding and analysis of trends, with robotic workers being able to interact with the data in more complex ways.

“You might have one particular main street, where a number of our clients operate from, and our robotic workers will be able to pick up where one particular side is utilising more energy than another in a similar environment. That’s where machine learning can start to help, and it can be utilised to be a benefit to individual clients.”

Progressing down the pathway through machine learning will help the company do more analytics around consumption, goals and net zero targeting, amongst other things, purely based on the robotic workers’ findings.

“We’re a relatively young company,” Mr Maine concludes, “with proprietary Australian technology. We are unique in the world in terms of utilising a robotic platform in the cloud for utility bills. We now operate in over 40 countries. We are expanding globally. Our customer base spend is in excess of $5.8bn in utility spend per annum. We’re very keen on propagating our story in the US specifically this year, and investing behind that opportunity.”

With its Robotic Process Automation technology offering global businesses a service unlike any other in the world, and a pathway towards even greater technologies, Bill Identity (ASX:BID) is forging a path through the fourth industrial revolution. Find out more about Bill Identity by visiting billidentity.com.  

Peter Ivany: Giving something back

Businessman and Philanthropist Peter Ivany in Boardroom Broadcasts

Melbourne-born businessman and philanthropist Peter Ivany made part of his fortune as Chief Executive of Australia’s second largest movie exhibitor, Hoyts Cinemas.

During his time at Hoyts Cinemas, which he ran between 1988 and 1999, Mr Ivany grew the business to over 2,000 theatres operating in 12 countries. Further business successes include home video rental business Video Ezy, and retailer Harris Scarfe, and he is currently the executive chairman of his own diversified investment company, Ivany Investment Group (IIG), as well as being equally, if not more, visible for his ongoing philanthropic activities and community involvement. Mr Ivany spoke with us recently to tell the story of how he made his wealth, shared advice on business for entrepreneurs, and explained his value system of giving back to the community.

Hoyts Cinemas

“In 1981, Twentieth Century Fox had been just taken over by Marvin Davis,” Mr Ivany says, “an oil man from Texas. His group were more interested in the real estate than the theatre business, so they put the cinemas business, Hoyts, up for sale. My father-in-law, Leon Fink was one of a number of partners that owned two theatres in Melbourne and they ended up outbidding all the others for the Hoyts’ business.”

Mr. Fink and his partners invited Mr Ivany to be part of the newly extended business and in 1983 he, his father-in-law and two brothers-in-law bought out the other existing partners and began to run Hoyts Cinemas together. “We also ran a range of other businesses at that time.”

These other businesses included two public companies in radio and other media, advertising, film and TV production, including the largest radio network in the country at the time, Triple M.

When Peter was appointed CEO of Hoyts, in 1988, a particularly hard economic time in Australia following the 1987 property crash, there was much work to be done to try to turn around the business. This was eventually achieved with a lot of support, hard work, determination, and a lot of sleepless nights.

“In 1993 my father-in-law, Leon, passed away, and I was able to buy out my other partners with the help of Lend Lease and Hellman and Friedman, a private equity firm out of San Francisco.

“We bought Hoyts out in 1993, started to expand internationally and in 1996 we went public, having grown the chain from 40 to over 2,000 theatres around the world. We were public for two or three years before we decided to sell the business to Kerry Packer’s Consolidated Press Holdings (CPH) in 1999.”

“At Hoyts, we rebuilt and reshaped not only the Australian cinema landscape but the cinema landscape internationally,” he says. “We were the first group to build multiplexes in Australia the late 80s and by expanding on this format, we saw the level of attendance increase virtually four-fold from the time I started in the business to the time I finished. It was very exciting.”

Mr. Ivany considers this period of his career, which he calls ‘phase one’, to have ended with the sale of Hoyts in 1999 to CPH. After the sale of Hoyts, he began to investigate and invest in businesses in different areas. These investments culminated with Mr. Ivany establishing the Ivany Investment Group which also expands on his philanthropic interests and activities.

Community focus

A driving force for Mr Ivany in all his businesses is the idea that through business acumen and generating profits, his companies could make positive changes for the whole, creating social benefits as well as economic ones.

Rather than spending more of his life building another company, as he did with Hoyts, travelling and filling his time with work, Peter wanted to give something back to society at large, and he wanted to do it in Australia.

“After the sale of Hoyts, I decided to spend half my life in philanthropy. It was an easy decision for me to make because I wanted to make a contribution, and hopefully a difference, to the community that had given me so much. The interests that I had, I just continued with them. I’ve stayed in film through AFTRS (Australian Film, Television and Radio School), NIDA (National Institute of Dramatic Art), the Jewish Film Festival and the Sydney Film Festival. I delved more into the sporting community with the Sydney Swans’ organisation and the Sydney Cricket Ground Trust. I was involved in art through the Art Gallery of NSW and the Museum of Contemporary Art and, of course, the Jewish community with the Jewish Communal Appeal. Also, I serve as an Adjunct Professor at University of Technology Sydney where I lecture and teach. So those are the few areas I’ve developed more fully in philanthropy.”

Having had the experience of living on a kibbutz at age nineteen, Mr Ivany developed a social conscience early on in life, and it has stayed with him to this day. His experiences with Hoyts, both good and bad, helped him meet the challenges faced in his philanthropic endeavours, ultimately helping them to succeed.

Businessman and Philanthropist Peter Ivany in Boardroom Broadcasts
I’m not going to say that there weren’t some dark nights, nights where it was hard to see the future

“I spend approximately 50% of my time in philanthropy and 50% in business. During the tough times of 2008, and even these [COVID-19] times, you end up spending more time in business, when it needs it, but over time it sort of averages out so that there is a balance.”

Backed by an excellent team at IIG, Mr Ivany can utilise his entrepreneurial skills on the business side to make sure it all runs smoothly and to ensure that they provide safe cash flow investments that in turn allows him to continue with his philanthropic endeavours and find that balance that he enjoys. For him, it’s never been about ‘who’s got the highest net worth.”

Mr Ivany still enjoys the business side of his life. IIG is diversified with its investments in property funding, technology, stocks and bonds and private equity and while some investments are passive, some are active. It is the active ones that provides him an opportunity to use his experiences and contribute mostly to the visions of others. He has spent considerable time over the last few years working on and developing the businesses of the Sydney Zoo, Allied Finance and IMAX, currently three of his larger projects.

“In the past I’ve been involved in quite a few ‘active’ projects that not only build businesses but also increases shareholder value such as Video Ezy and Tourism Asset Holdings Limited, “TAHL,” managed by Accor Hotels, which was Australia’s largest hotel operators.”

The diversification between passive ventures or investments allows him to be able to allocate more time to his philanthropic and community-based work.

“The philanthropy is not just a time commitment,” Mr Ivany says, “it’s also strategic. You’re helping people build their organisations and helping them reach their visions for the community. The not-for-profit sector is growing rapidly, probably because more and more people are finding that, not only is it an important way to spend their time, it is also vastly fulfilling to be involved with organisations that benefit social welfare.”

Doing business without fear

When Mr Ivany found himself in the position to buy out his partners at Hoyts, he had no real experience of what he was going to be up against and therefore he had no fear. This is something he admits was key to his success.

“For approximately three years, between 1987-1990, we were facing huge losses, so I had to ask the question, do I go and do something else or do I try to find a way to make it work? At the core of it, I believe I am someone who likes to find solutions and who isn’t afraid of the hard work it takes to make things happen and even in this situation, I truly believed that I could find a solution. When I put CEO on my business card it enabled me to make the often tough, necessary decisions and slowly we made our way back from the negative and started turning it into something positive.”

Mr Ivany admits that the most important skill in that situation is to back yourself and have a vision. You can’t look at it in terms of risk analysis, because the risks are too big. Mr Ivany feels the main traits of entrepreneurship are having confidence, backing yourself and working around the clock.

“We were able to find hope when there was none,” he explains. “We restructured the whole business by reducing our bank debt, we sold off surplus assets and significantly improved our profitability in our core business.”

Making a business successful is all about finding the small positives, which Mr Ivany did as CEO of Hoyts, and then timing it right to find the solutions. In the late 80’s they could have sold the business cheaply and moved on elsewhere, but they held out because not only did he enjoy the business, he believed in it.

“I’m not going to say that there weren’t some dark nights, nights where it was hard to see the future. There were times when you get very little sleep, and there was no balance in your life. We made it with the most finite of margins.”

At age 35, Mr. Ivany found that people were beginning to believe in him on the back of this incredible turnaround. This kind of success can provide an enormous amount of confidence for somebody in a leadership position – and confidence is key.

“Any leader has to have people that follow them and for people to follow a leader they have to believe in the person that makes the decisions. To be that leader, you need to believe in yourself. If you believe in yourself others will as well, because people want answers, they want solutions and they want a pathway in life. Any leader has to give people paths.”

“What I have found is that once somebody has become used to running a business themselves, and has achieved a certain level of autonomy, their skills become far more general than specific, and in effect they make themselves virtually unemployable in any other format.”

“If you want to continue to work, then in effect you have to continue to be an entrepreneur, because really there is no other solution. It’s difficult when you have run your own business, made the decisions, and reached a certain age to then pivot into an institution with multi-layered, bureaucratic systems. I’m not saying that it can’t be done, just that it is difficult to do.”

Entrepreneurs are often born by realising that they are leaders rather than followers. Once they have found a way to live this lifestyle, it’s all about finding the right people who share the vision and lead them effectively.

“At the end of the day, I work with a small team. I’m still involved in every aspect of all the businesses, but it works, because you don’t have those layers of bureaucracy to slow you down and you don’t have to ask for permission. With everyone contributing, you can get ahead of your competition and you take out all the obstacles to success.”

“Even with big businesses and governments that are full of executives, politicians, and policy makers the final decisions are made by one or two people, it’s just the way the structures work. The key to success is to have one clear direction that everyone is pulling towards.”

“That’s sort of how it worked for me,” Mr Ivany concludes, “and then basically I’ve continued that way of doing things across a number of different organisations, and it’s been effective and it’s been helpful, hopefully. What I’m most proud of, in a sense, is that every organisation I’ve been involved with are still thriving today.”

Peter Ivany has had an entrepreneurial career that has spanned more than 40 years. During this time, he has worked through the highs and lows that comes with the territory of hard work, determination, and strong business practices. He counts himself fortunate to be able to take this opportunity to use part of his wealth to give back to the Australian community. For more information on Mr Ivany’s investment firm, visit www.ivanyinvest.com.au.

Kidoodle.TV: Safe streaming for kids

Featured image - Kidoodle.TV Co-Founder Neil Gruninger - Boardroom Broadcasts

A family-focused kid’s streaming company, Kidoodle.TV is committed to encouraging safe streaming and viewing habits, hand-picking every show to ensure content is age-appropriate and represents the best in educational, entertaining, and inspiring stories.

Co-founder, President and Chief Product Officer Neil Gruninger co-created Alberta-based streaming service Kidoodle.TV from the ground up. For the past decade, Mr Gruninger has focused on web development, online user experience, and e-marketing, and is keenly passionate about creating better digital experiences for young people. The parental presence, along with the ability to control the experience through monitoring systems and time limitations, have allowed Kidoodle.TV to make a significant impact in 140 countries around the world. Mr Gruninger discusses the inspiration behind Kidoodle.TV’s inception, the global mindset that has aided the company’s growth, and the continuing commitment to providing kids and families with a safe streaming platform.

Safe Streaming™

“Kidoodle.TV was really built upon the thesis of families and video distribution being connected through the internet,” Mr Gruninger says. “I started getting into video distribution as part of a technology corporation that basically built out an algorithm for video distribution. [Kidoodle.TV] co-founder Mike Lowe and I actually met through that process.”

The two co-founders came up with the product after Mr Lowe discovered his youngest son had accessed inappropriate content through other popular streaming services. They realized that there was both a business opportunity and a problem that needed solving.

“Immediately, he and I just decided that this was something that we were going to move forward with, took some employees with us, and ultimately created Kidoodle.TV in 2012, so it’s been almost nine years.”

The process since that moment has been interesting, involving plenty of problem solving in working out the different ways in which families and children can access Kidoodle.TV online, with mobile apps, connected TVs and smart TVs all becoming popular choices.

“The media landscape has shifted at an exponential rate,” Mr Gruninger explains. “We wake up and we have to keep up, every day, and really it’s paved the way for what we’re trying to do to make sure that kids are safe online. We trademarked Safe Streaming™, and it’s our core of what we’ve built and what our mission is online.”

The rise of content services such as YouTube has meant that there is now a proliferation of online content for kids, and this in turn has increased demand, with the internet now becoming the dominant method of content consumption.

“We own all of our technology, we’ve built it in-house. That was one of our main objectives from day one, to own and not lease, because at the end of the day it didn’t give us the agile momentum to shift and be a part of this forever-shifting video space.”

By joining the wave of internet video distribution, Kidoodle.TV has seen some real growth over its almost nine years of existence. The recent COVID-19 pandemic has created even more demand for such content to be readily available.

“Families are home, they need safe entertainment and educational content, so it’s been great to have built this for the last 8-9 years and finally really understand that families and the industry have caught up to what our vision was.”

There are a lot of kids streaming services out there, giving Kidoodle.TV plenty of competition, but Mr Gruninger feels it is differentiated from that competition by the company’s image and core family-focused values.

“Ultimately we built the service from a product of our own needs, and that’s key. You have Amazon, Netflix, YouTube, Disney. These are companies that are paying billions of dollars for content – we don’t have those costs. It allows us to have a wider audience.”

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“Kidoodle.TV was really built upon the thesis of families and video distribution being connected through the internet”

The variation of content across these bigger names has become key for kids and families. By getting access to top content, focusing on families and championing Safe Streaming™, Kidoodle.TV is able to positively differentiate from other platforms. The rise in gaming content has definitely been a factor in getting top content.

“Gaming content is this crazy new-age, modern day entertainment,” Mr Gruninger says. “It’s become the majority of what kids today are looking for. It’s been great to be a part of that process and understanding that.”

The connectivity of the internet has revolutionized gaming and built upon the industry. Having safe streaming gaming content integrated into Kidoodle.TV has been a huge value add for the company’s customers.

“A lot of times parents are expecting some older, recognizable, traditional content that they may have grown up on, and we have that as well. We have such good industry credibility when it comes to all the content providers who want Kidoodle.TV, because we have millions of families that are currently using our service every day.”

In terms of producing content, the company has started to make its own originals, which has been an extremely fun and creative undertaking, with a focus on what new things it can do in the kids streaming space.

“We’ve been working with YouTube stars that have created an incredible amount of usership and now they can’t monetize their kids content on YouTube. They’re looking for a place to house their content to actually be able to make money with, and we’re that alternative to a lot of these content providers today.”

Built for today

Based in Alberta, Kidoodle.TV has had to adjust to some particular measures to fit into the technology sector in the province, and Mr Gruninger admits that it hasn’t always been the easiest of adjustments.

“It’s been challenging in Alberta over the years,” he explains. “I would say now more than ever we’re seeing some recognition, we’re getting some street cred. That comes from just sticking to our guns and moving forward and building upon the vision of keeping kids safe online. But we had to go outside of Canada to really build the momentum.”

Both co-founders grew up in Alberta, and still have family in the province, but a lot of the financing they needed to make the company viable had to come from elsewhere. It has been a slow process feeling a part of the tech community in the area.

“We’re proud Albertans, and we get what we offer as a whole, and what the community can do for us. We’ve hired now 40 people during COVID, all very passionate about what we’re doing and excited to work with us.”

Ultimately, the tech sector in Alberta is young and growing, and Mr Gruninger admits that the company is more than happy to do what it can to help with that growth and to build upon the technology and media industry to help Alberta as a whole grow and diversify.

Kidoodle.TV - editorial image - Boardroom Broadcasts
Having safe streaming gaming content integrated into Kidoodle.TV has been a huge value add for the company’s customers

Although the company is Canadian, it operates in 140 countries across the world, meaning it always has a global mindset. It’s partnership with mass media and entertainment conglomerate Corus Entertainment has helped it reach this point.

“We’re an ad supported video service, so AVOD is the acronym there. Corus is the one that represents our specific inventory here, and they go out and sell our ads. But, the majority of all our usage is in the United States.”

The company has excellent representation in Canada, as its core distribution partners like Roku, Samsung and LG have supported the platform in the country. However, Canada itself is only a small part of the company’s market.

The company’s current focus is on making Kidoodle.TV feature-rich and enhancing the user experience. The technology is really the core focus, making sure that it can offer the very best streaming service.

“We’ve hired a bunch of grandparents to go through all of our content before it gets on the service. A real key focus of ours is growing that employment base and really getting them involved, because they are so key to keeping kids safe online. They watch every single frame of that content before it goes out. So that’s been great.”

The service has been built for today, so in that respect the future is now. There is so much still ahead of the company, including launching on the huge US telecommunications company, Comcast, in the near future.

“Comcast is a big company, and they want Kidoodle.TV, and it’s pretty cool. This has taken years and years, but we’re finally hitting these benchmarks of distribution platforms that just recognize us as one of the top services out there, and they can’t deny the growth and what families are looking for. That’s been very exciting for us.”

The truth is that where the company used to be calling the big distributors, asking to be put onto a platform, the big distributors are now calling Kidoodle.TV because of its reputation and previous success.

“We’ve got Paw Patrol. It’s a big, big brand. We’re one of only a small amount of streaming services that even work with Spin Master, which owns the IP for Paw Patrol. We’re getting some other big brands – in two weeks from now, we have a major launch campaign with the top brand in the world, and that’s what families are looking for.”

The journey has been fun and exciting, and has it has come to the point where the company is outperforming itself every day, with a great trajectory for success, and growing impressively from an employment standpoint.

“Our future is just continuing on and keeping kids safe,” Mr Gruninger concludes, “and making sure that families have an alternative outside of YouTube, because that’s really where they’re finding their content today.”

Operating in a rapidly growing market, and differentiating itself from the competition with a commitment to offering a safe streaming space for kids, it certainly appears that the future for Kidoodle.TV will be glowing. Find out more about Kidoodle.TV by visiting kidoodle.tv.

Security and Disinformation – twins that breath the same air

syria-Noel Hadjimichael-Boardroom Broadcasts

“Millions of people stuck at home will turn to social media, where disinformation is rife. Radical Islamists and far-right groups are exploiting widespread confusion and fear to spread hate.”

Nikita Malik in Foreign Policy, one of the world’s top international relations journals, as early as March 2020 as the global pandemic started to take hold. A warning that is much wider and more sinister than just deluded extremists or xenophobic neofascists. Across the liberal democracies, commercial, cultural and civic organisations are under siege from enemies to reason or rational debate. Forget fringe dwellers on the political margins or flat earth advocates of doomsday retribution – today’s disruptors are often State players or proxies generating millions of data strikes to unsettle, unnerve or undermine. Australian, Canadian, US or German interests – all are facing severe assault by nation states, rogue cyber operators or dissident minorities emboldened by the era of instantaneous information sharing at the click of key stroke.

Business, Church, professional, personal reputations are all ripe for disinformation. Charitable bodies, education institutions and government departments can be targets of campaigns to intimidate, harm, hinder or just harass. The costs associated with offensive digital attacks are small for the number of stakeholders reached. No sophisticated spy embedded into the organisation or devious “front organisation” needed as the only way to persuade opinion in a particular direction.

Wars have been won by deception or deceit before – the success of the British in shifting American public opinion prior to Pearl Harbour was a masterful exercise in civil society engagement. From influence over Hollywood scripts, to supplying newspaper articles for syndication all the way to direct lobbying efforts – all played their role. Opinion can be shaped by friends as well as foes.

Australian exporters facing Chinese trade difficulties or Canadian business operators worried about the safety of their staff on the PRC mainland can be pressure points amplified by social media, academic or pressure group activities that attempt to weaken national resolve. Allegations of Russian electoral interference in the 2016 US elections are timid when compared to active opportunities to ferment social division or commercial harm to institutions across society.

Three areas are of key interest to the Australian business sector are: civil freedoms, market sustainability and civic stability. For enterprises to grow, shareholders to prosper or executives to make decisions within a dependable climate of rules. The advent of fierce and effective social media campaigns to injure rather than inform has been a tough lesson. Corporates can be subject to reputational damage that takes hours to trigger and possibly years to correct. Commercial leaders can be identified for personal and professional treatment in the court of public opinion. Brands, products, factories or messaging can be subject to harassment to the point of censure.

The two strongest candidates blamed for anti-Western disinformation appear to be Russia and China. Nations such as North Korea, Iran and Turkey are often criticized for effective cyber or social media interference at substantially lower levels of impact. Propaganda is neither crude or subtle – it is all about message, delivery and capacity to build narrative.

The Australian Strategic Policy Institute as early as 2018 has reported on the alleged distinctive characteristics of Russian versus Chinese interference. Motivation by Putin’s Russia has been said to be driven by a desire to undermine the value of democratic systems and punish Western interests for their so-called destruction of the USSR’s place in the post 1990 world. The PRC has been given credit for a more strategic and geopolitical approach designed to isolate critics, punish trading partners or cultivating friends in high places.

Exporters across Australasia, North America and Europe are well aware that they face market barriers or consumer boycotts that can be turned on and off like a tap. Commercial and professional service firms are operating in an environment that reflects one compliance regime in some markets and vastly different rules in another. Universities are hugely dependant upon foreign students for income and foreign aligned donors for research cash. Critics of regimes violating human rights or acting in an aggressive manner are easily silenced or marginalized when big dollars are in play.

Security concerns over 5G exist. Australia and the US have sparked a revision of policy regarding the desirability of certain players in the development of key infrastructure. The United Kingdom and Germany are having a robust debate over the fragility of links to providers across a number of technologies and industries. Oil from the East, AI developed in Shanghai or telecommunications networks open to harm are big issues in Europe.

The business of spying is done by just about all nations. The promotion of the national interest is a natural commitment of governments. However, the inability to effectively factcheck the abundance of fake news or distorted narratives is a problem for all. 

Elections that are influenced by your enemies, industries libelled regarding their sustainability persons vilified by social media attention appear to be the price to pay in free societies with open channels of information flow. No more lawyers or newspaper barons to suppress the unpalatable. No expectation that what you read about yourself, your company or your country is even half substantiated. 

The business of enterprise relies on liberal markets, sound laws, dependable governments and a rules-based system of checks and balances. Profits can be gained in less democratic societies. But they come with a cost. Profits can be made ignoring threats to your own society. But appeasement turned sour in the 1930s – a toxic reminder of the cost of turning a blind eye.

Security of profit, dividend, production and employment needs robust free societies. Security from disinformation is more than just desirable – it is about sustainability. Reputation or resolve lost is hard to regain. 

Noel Hadjimichael is a London based public policy consultant in the security, defence and civil society space with relevant experience working in politics, the civil service, industry and the charitable sectors.

Acerus Pharmaceuticals (TSX:ASP | OTCQB:ASPCF): Building a sustainable, value-driven company

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A TSX-listed commercial-stage pharmaceutical company, Acerus Pharmaceuticals has a vision to become a leading specialty pharmaceutical company focused on urology and Men’s Health with its nasal testosterone treatment, Natesto.

Founded in 2009 and listed on the TSX (ASP) and the OTCQB (ASPCF), Acerus Pharmaceuticals is a micro-cap with a market cap of $50m CAD as of August 25th 2020. Company President and CEO Ed Gudaitis has held numerous senior positions in multi-national pharmaceutical companies, working in both Canada and the United States, and has been responsible throughout his career for launching and building billion-dollar pharmaceutical product franchises and country operations. Mr Gudaitis discusses Natesto, the firm’s disruptive technology that can potentially secure significant share in a more than $1 billion USD global market, the unique opportunity available to potential investors in the company, and Acerus’ vision to become a leading specialty pharmaceutical company in urology and Men’s Health.

Nasal testosterone

“Acerus is a commercial-stage specialty pharmaceutical company,” Mr Gudaitis explains. “We have an approved product on the market that we are commercializing, and our focus of effort is on specialists, not primary care physicians.”

Although the company is based in Ontario, Canada, its business is global. The company manufacturers and commercializes its core product, Natesto, in a number of global markets, including the US, Canada, South Korea, and Taiwan, with plans to move into Europe in the next eighteen months.

“In the US and Canada we commercialize the product directly through our own sales and marketing efforts, while in South Korea and Taiwan, and eventually in Europe, we commercialize through partnerships with local operating companies.”

Unlike some other companies in the specialty pharma space, Acerus is not built on licensing in other people’s assets. Acerus’ focus is on manufacturing and commercializing its core product in-house, making it a unique proposition as a company.

“We’ve been around for a while. Formed in 2009, the company has gone through a couple of iterations of strategy. It was previously called the Trimel Pharmaceuticals company, and it was structured to capitalize on a core technology, our nasal gel technology, which enables us to deliver products in a unique, patient-friendly manner.”

The problem that the company looks to solve is a very unique. Our primary market opportunity is the treatment of low testosterone, otherwise known as male hypogonadism. Around 14 million US males potentially have low testosterone, making a sizeable possible market.

“It’s about a $1bn USD prescription product market opportunity in the United States, with about 7 million prescriptions written per year. There are products that exist today, however there is no truly ideal product in the market place. There are a number of products with challenges in terms of how they’re delivered.”

The main options in the market for low testosterone currently are testosterone injections, deep and painful injections with a large needle, presenting challenges with self-injection. There are also topical gels, which act like a skin lotion that you rub in each day.

“With the topical gels, you have to worry about potentially transferring the product to your spouse or your children,” Mr Gudaitis explains. “After you apply the product to your body, you have to let it dry for twenty minutes, it can absorb differentially and not evenly all the time. As a result, there are several challenges with existing products in this market.”

It is estimated that up to 70% of patients on prescription treatments for low testosterone will switch therapy at least once to look for better options, as patients and their physicians are unsatisfied with the current treatments available.

“Prescription treatment of low testosterone is a very large market that has been well established. Physicians know how to diagnose, treat and prescribe low testosterone treatments. However, there is no single ideal product in the market. We think we can solve a number of problems within this large market, providing a patient-friendly, safer, effective alternative in a very large and growing market opportunity.”

Acerus’ unique technology creates a different product than any other in the market for testosterone treatment, an intra-nasal gel application of testosterone applied with a small dispenser three times a day on the inside of your nostril.

“It’s a little bit like a topical hand lotion that you would put on your hand. It’s a gel, not a spray, applied with our dispenser on the inside of your nasal cavity. The product is rapidly absorbed, highly effective, with low side effects.”

Acerus Pharmaceuticals-Natesto-Boardroom Broadcasts
“With the topical gels, you have to worry about potentially transferring the product to your spouse or your children” - Mr Gudaitis

Unsatisfied market

The uniqueness of this nasal testosterone technology offers investors an exciting opportunity to invest in a company with a highly differentiated, unique product offering.  The technology is an Acerus propriety technology, which was licensed in by Acerus, protected by a strong patent strategy.

“The Intellectual Property in the US, Canada and Europe is very long-ranging. We have a current suite of patents that would take us into the mid-2020s. We have new patent filings and strategies that we’re actively working that would take patent protection into the early and potentially the late-2030s. We have a unique technology and a solid IP platform to work from.”

This means the company has a ten or twelve year run in front of it with a very large, unsatisfied market opportunity to be capitalized on. This opportunity is primarily in the United States, but there is also significant market opportunity in the Canadian and European markets.

“If investors are looking for an opportunity,” Mr Gudaitis says, “we’ve got all the pieces in place, we now need to execute and deliver on the opportunity that’s there. We’ve got a better product, in a large market that’s unsatisfied – let’s go and make it happen.”

The company’s management team is made up of Mr Gudaitis, who has been in the pharmaceutical business for over 25 years, and new additions who bring relevant expertise within the US pharmaceutical market – Chief Medical Officer Dr Chris Sorli and US Commercial Leader Kevin Hickey.

“I spent about eleven years with Gilead Sciences as part of my career journey, some of that here in Canada building the Canadian operation from scratch to about a $1.2bn CAD business, but also in the US, where I was Senior Director for HIV marketing for a number of years, launching several large HIV products in the US.”

Dr Sorli is a board certified US-based endocrinologist and is responsible for the company’s medical affairs and R&D activities. His background is in diabetes, metabolism and Men’s Health.  He has previously organized and set-up a large men’s and women’s health practice in his home state of Montana. 

“[Dr Sorli] has direct clinical experience treating the type of patients we would be treating with Natesto, but he’s also very much been on the forefront of metabolic disease and diabetes, which is an area that we’re interested in looking at with respect to Natesto, and he’ll be actively driving the strategic development of the clinical profile of Natesto.”

Based out of Philadelphia, Mr Hickey brings fifteen years of direct commercial experience in the US and will be responsible for leading the Natesto business in the US as the company moves forward.

“From a management perspective, we’ve got people with direct experience in the U.S. marketplace, and relevant experience to our business, to our therapeutic area and to what we’re trying to achieve onboard at Acerus.”

The company’s board has also seen some recent additions, complimenting a number of long-standing members, including Chairman Ian Ihnatowycz, who has served as a Director since September 2013.

“[Ian] is our leading shareholder; he owns about 84% of the company, and he’s been a long-time board member. He’s a long-time investor and has been a core visionary for the company over that period of time.”

Other long-time board members include entrepreneur Stephen Gregory, and Borys Chabursky who is the founder and Chairman of Shift Health, a healthcare consultancy in Toronto, plugging him in to the start-up, Venture Capital and healthcare consulting spaces.

“We’ve added two new board members recently – a fellow by the name of Scott Leckie, who’s our Audit Committee Chair, he’s a CFA and has significant investment experience. He used to run a private investment company, so he brings that capital markets/investment side to the table.”

“We also recently added Geoff Cotton, a US-based commercial and medical affairs pharmaceutical expert. He is an MD by training, has worked in medical affairs, and he’s also launched products in the US and has run various US businesses, at one point for Gilead, that range up to about $8-9bn USD in sales.”

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Acerus’ patent strategy presents a unique opportunity for success for the company and potential investors

Block and tackle

With this mix of long-standing team members and new faces, Mr Gudaitis is confident that the team has the relevant experience and skills to make the business a success with Natesto, which he identifies as the company’s short-term goal.

“I usually describe our strategy in three phases – phase one is the here and now phase, and really the goal is to get Natesto moving and get it commercialized successfully in the US. That’s the core platform for the company, that’s the foundation for the business, and we will build the company around that success, and that’s really what we’re focused on right now.”

The second phase is to leverage the commercial infrastructure the company has built in the US by adding more products to its portfolio through business development opportunities that will complement and leverage the investment already made.

“The third phase of the growth strategy for us would be to circle back to our pipeline and bring in some additional products, whether they are something that we can build into the nasal gel technology, or even something that complements our focus on urology and endocrinology from an R&D perspective.”

The end goal is to have a growing and maturing business with Natesto that becomes the engine of the company, with a couple of complimentary assets added around the product in order to leverage the commercial infrastructure and investment, and then something in the pipeline to give the company continuity into the future.

“So that we have a late-stage mature product, we have a growth product, and we have some new products,” Mr Gudaitis says. “That would be the ultimate goal in what we’re trying to achieve in terms of the short, medium and long-term to build a sustainable, value-driving company for investors.”

Over his 25 years in the business, Mr Gudaitis believes he has learned some important lessons, many of which came during his time working at Gilead Sciences, a company that was run on the premise of being lean, hands-on and focused on outcomes.

“For a small company like Acerus, I look through that lens every day. We have undergone some significant reorganization and streamlining of the operations. The biggest lessons for me have been – focus on what you can control, keep the business lean, and keep focused on the result and the outcome. That’s one of my key takeaways from my Gilead experience.”

Another key lesson learned has been to embrace good old fashioned blocking and tackling, a strategy that the management and board are well set-up to execute in the case of Natesto to make the business a success.

“If you go in and do the basic executional elements well – build good key opinion leader support, make people aware of the product, have reimbursement in place, have the support systems for physicians and practices to get product to people when they need it, and have patients activated to ask for the product – you will be successful in this category.”

With a full product life cycle in front of it, Acerus’ patent strategy presents a unique opportunity for success for the company and potential investors. Find out more about Acerus Pharmaceuticals Corporation by visiting www.aceruspharma.com.

Who dares wins – America’s impending new political paradigm

Joe Biden - Matt Versi - The Boardroom Broadcasts

In 2008, Americans voted for change. A bright, charismatic young senator from Illinois ignited the imagination of the American voting public. Disillusioned with the political class, and opposed to the direction the country was headed, they lined up for hours to cast their vote, not just for America’s first black president, but for the man they believed could change the system and represent their interests rather than those of corporate donors and the billionaire-class. After eight years in office, and little change in Washington D.C., President Obama, by his own rhetoric as a yard stick, failed to change Washington, which by the end of his administration had already started to sink back into the, so called, swamp.

In fairness, as soon as Obama swore his oath, Republicans in Congress were already laying out their strategy to oppose, slow and, if possible, derail his agenda. That is, as they say, politics. The Republicans may have lost the election, but they still had a constituency to represent. That constituency made itself heard during the 2010 re-birth of the modern Tea Party which, yes, was comprised mostly of Republicans, but also disillusioned Obama voters who viewed his bailout of the banks and Wall Street, during the Global Financial Crisis, as a betrayal, leaving them – the middle and working class – to pick up the pieces. 

The Tea Party movement, while ironically commandeered by billionaires and Wall Street, planted the seed for the reactionary movement that was to come. While in its early iteration the movement propelled rising stars like Marco Rubio and Ted Cruz, it also captured the attention of property developer and reality TV star, Donald Trump. The messaging coming from the Tea Party echoed much of what Trump had been saying for the past thirty years. However, as time went on, and once elected, the Tea Party’s rising stars drank the swamp water and, before long, began singing from the establishment song sheet of tax cuts and smaller government as the core “solutions” to America’s problems. In 2012, the Republican establishment did what they usually do and ran an old-style economic liberal and social conservative candidate, Mitt Romney, who campaigned on the same tired and unimaginative policies of tax cuts and smaller government. In a choice between the establishment Romney and the incumbent president who was again offering hope that he could still change the system, voters clung to the latter and re-elected Obama.

Cut to 2015, the lead up to an open seat presidential election (so named because the incumbent president isn’t running) and the field is flooded with Republican candidates chasing the Party’s nomination. It was a mix of legacy establishment candidates like Jeb Bush and John Kasich, and the new generation GOP candidates Marco Rubio and Ted Cruz – again, all humming the same tune. On the Democrats’ side the Clinton machine had all but won the battle before it was fought – spending the preceding three years taking over the DNC and skewing the nomination process in Hillary Clinton’s favour. Only a handful of unknowns put up their hands to compete for the nomination, only to be brushed aside by Democrat voters as uninspiring, with one exception: former democratic socialist Senator Bernie Sanders. Despite his early momentum with young voters, the Clinton machine wrote off Sanders as an eccentric nobody – an almost fatal move.

Enter (or should I say ascend down a golden escalator) Donald Trump. In a choreographed for TV event, Trump announced he was running for president. But, gold and marble lobby surrounds aside, this was no ordinary announcement. Trump, speaking mostly off the cuff, used this highly televised speech to blast the establishment of both parties, blaming them for the state of decay he believed America had fallen into. The content of the speech was confronting, striking a tone eerily similar to the Netflix show House of Cards which had aired an episode earlier that year depicting fictional president Frank Underwood declaring to the nation, “The American Dream has failed you. Work hard? Play by the rules? You aren’t guaranteed success. Your children will not have a better life than you did.” In his announcement speech, Trump took it further: “Sadly, the American Dream is dead” he proclaimed. For many Americans, hearing those words said aloud by an actual presidential candidate echoed their own long held feelings about America in 2016. They had worked hard and played by the rules, but what did they have to show for it? Nothing, many concluded. If the hope they had placed in Obama changing the system hadn’t worked, Americans had now decided they were prepared light the fuse by sending in Trump to blow the system up.

One by one, the establishment GOP candidates fell to Trump as he crisscrossed the country in his private Boeing 757 jet, appropriately referred to by his supporters as ‘Trump Force One’. In the end only two serious contenders remained: the former Tea Party stars Marco Rubio and Ted Cruz, having only won three and 11 states, respectively. Both withdrew from the race and eventually endorsed Trump as the Republican nominee. The hostile takeover of the Republican Party by Trump had not only shaken up the GOP, it would completely re-orientate the American political paradigm, replacing the economic libertarianism of tax cuts and smaller government with a bold and audacious economic nationalism that made the interests of the American working and middle-classes paramount, and ushered in the new parlance of ‘fair trade’ over just free trade.

Clinton struggled to capture the excitement of the Democrats’ base in the way Bernie Sanders had managed to do. Nevertheless, the Clinton machine had clenched the Democrats’ Super Delegates (comprised of party apparatchiks and former political office holders) and turned their sites to Trump. Again, voters were being offered a choice between an economic neo-liberal establishment figure defending the record of the previous administration and the status quo, or an outsiders’ economic nationalist message of America First. FBI investigations and Wikileaks aside, Trump’s campaign resonated with those Americans who felt they had been left behind by the economic policies of previous administrations and so, as they did for Obama, millions of those forgotten Americans cast their vote for Trump.

In 2020, history is repeating itself. Trump, now the incumbent, has spent the past three years implementing his American First policies that had not only yielded, arguably, the strongest American peacetime economy in the nation’s history, with record unemployment numbers for almost all demographics, but also saw the reset of the global order, reorienting American foreign policy away from acting as the Free World’s Atlas, and towards a multinational effort of free nations – now rebuilt and highly advanced since the end of the Second World War – to share the burden militarily, if not then financially, of defending the Free World in the 21st century.

Former Vice President Joe Biden, now the Democrats’ nominee for president, finds himself curiously in a similar situation to Clinton in 2016. After a bruising early Democrat primary packed with prominent candidates, including the resurgent Sanders, Biden has come out the other end in an unenviable position of having to both defend the Obama administration’s liberal record and attempt to reconcile the more radical policies and causes being championed by an ascendant New Left, comprised of Sanders aligned democratic socialists. The only thing holding those two competing factions together seems to be their shared hatred of Trump. One may rightly anticipate that, if they were successful in defeating Trump, the two factions would descend into open conflict for control of the Democrat Party. It’s hard to see a President Biden being able to maintain party unity beyond the election.

An example of this tricky situation are the protests for police reform, which began following the killing of George Floyd by Minneapolis police. The protests briefly began as peaceful, but were quickly highjacked by anarchists and militant communist agitators calling themselves ‘ANTIFA’ – a name previously used by German communist groups in the 1930s. ANTIFA and its supporters have used the cover of the protests to attack police, bystanders and anyone they determine to be opposed to their political ideology. They’ve been widely supported by New Left Democrats who have joined their calls to defund the police.

In the beginning, Biden and his new running mate, Kamala Harris, both backed the protests, with Harris declaring that the agitators “are not going to stop. Everyone beware, because they’re not going to stop before Election Day in November, and they’re not going to stop after Election Day”. As the protests continued to grow increasingly violent the Trump campaign capitalised on Biden’s hesitation to condemn the rioting, by pivoting their campaign narrative to one of law and order. Biden has since been forced to publicly condemn the rioters and agitators. However, Biden’s team know he is walking a thin line trying to draw a distinction between supporting the peaceful protestors and the brave police officers who are trying maintain the peace, and the radical rioters, supported by the New Left, and the police officers and policing practices that led to Floyd’s death. When discussing the protests and the police, Biden may ironically need to make his case by pointing out that there are “some very fine people on both sides”.

Biden’s work to maintain a unified party and present an acceptable vision for America to voters has been made even more difficult thanks to Congressional Democrats’ insistence on using parliamentary tactics to attack, delegitimise and ultimately remove Trump from office through impeachment. Since Trump’s election, Democrats have transformed themselves from a party of government – having maintained their majority in the House of Representatives for much of the post-Second World War period – and into something that harkens back to the short-lived Anti-Jacksonian Party of the 1820s, whose primary organizing principles was defeating President Andrew Jackson.

Distracted with conspiracy theories and dodgy dossiers, Democrats have failed to regroup and reassess what went wrong in their 2016 campaign, and why Americans in a majority of states, including traditionally ‘blue states’ turned their backs on them. Parliamentary tactics and personal smears aren’t going to be enough to win an election. Americans aren’t schmucks, they know, as Obama put it in 2008 that “when you don’t have a record to run on, you paint your opponent as someone people should run from”. In order to bring back those disillusioned voters that put both Obama and Trump into the White House, Biden and Harris will need to clearly articulate a new vision that will propel the country forward, and not backwards to the old status quo.

One Trump policy a Biden administration would be expected to continue is America’s new hawkish China policy. It may have taken Trump to finally act on China, but establishment Democrats in Congress are now well aware of the challenges the Chinese Communist Party (CCP) poses to the world order and to America’s interests. They will push Biden to continue to counter the CCP’s global debt-trap diplomacy through its Belt and Road Initiative – more aptly named Bait and Switch Initiative. However, Biden will need to avoid the pit fall of readopting the post-Cold War defense arrangements America’s allies had come to exploit. A war fatigued American public will not accept America returning to the role of the world’s sole police man (at least not for the foreseeable future). Trump’s policy of America leading a multinational collaboration of free nations all contributing militarily and financially to the defense of the Free World is the key to being able to sustain a long geopolitical struggle with China.

At the time of writing, there is less than 60 days to go until Election Day, and the polls look to be extremely close. Again, an eerily similar situation to 2016. Trump is still seen by voters as the best candidate to manage America’s economic recovery from the CCP’s Coronavirus, and his campaign’s law and order messaging is resonating in key battleground states where videos of burning cities are still flooding their newsfeeds.

The debates (assuming there will be more than one), will be the deciding factor of the election, October surprises or not. Unless an extremely rehearsed Biden can show up to the debates, stick to his lines and not lose his train of thought, Trump will depict him as not only unable to control the radical elements now infiltrating the Democrat Party, but also show Biden is in cognitive decline and that, if elected, Americans can’t trust that it will be Biden actually running the country.

Regardless of who wins, one thing is certain: the very notion of what it means to be a Republican or a Democrat will be reshaped, ushering in a long lasting new political paradigm for America in the 21st century, with the ripple effects felt all over the world.

Matt Versi is a public policy advocate and strategic communications specialist, advising multi-national companies and government leaders, including serving on the staff of the Hon Scott Morrison MP, Prime Minister of Australia. Find out more my visiting MattVersi.com.